Royal Bank of Scotland’s outgoing and former heads of its investment bank, John Hourican and Johnny Cameron, reunited this afternoon in one of the Parliamentary Commission on Banking Standards’ most keenly-awaited sessions yet.

Also appearing with Cameron and Hourican was Peter Nielsen, who leads RBS’s markets business under Hourican and will report directly to group chief executive Stephen Hester from next month http://bit.ly/Y4MVAK.

Financial News live-blogged the session.

• Live blog

15:10: Well, for those of you expecting a slow burner this afternoon, with attendees thanked for appearing before we move almost casually onto the main fare, you’re bound to be disappointed. Things have got off to a sizzling start, with the first broadsides fired by Rory Phillips QC, counsel to the Commission.

He wastes approximately zero seconds before addressing the Libor issue – let’s not forget this is a session about banking standards rather than just manipulating rates. And after listening to what Hourican, Cameron and Nielsen did and do in their RBS roles, and having had it confirmed that the Libor wrongdoing occurred from 2006 until March 2012, he is not satisfied when he’s told 21 RBS individuals “continued their subversive” behaviour throughout that time. “It goes further than that,” says Phillips. “You were part of the management team at the time.”

Nielsen says he contemplated resigning his post over Libor. He says: “Whenever you get an incident of this seriousness and magnitude, of course I contemplated resigning.”

Nielsen says he and Hourican discussed whether one or the other, or both of them, should resign over Libor. He says he stayed as he has “more to offer” the bank: “From my point of view I believe that we’ve accomplished a great deal since attempting to right the bank in 2009 and I think that I’ve appreciated being able to play a part in that and feel that I’ve got some more to offer.”

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Hourican echoes this point. “It’s the right thing for the bank and all of our stakeholders was that I would take the ultimate responsibility for this issue,” he says.

Hourican adds that he is “very sorry this happened on our watch”.

15:25: Nielsen says Libor manipulation may not actually have benefited RBS. It may have benefited one trader's book while disadvantaging another's, he says. “The bank might well have been worse off”, he adds.

However, Nielsen says “we can’t say no [it did not benefit RBS]” either.

15:30: It’s a fair bet that roughly a year ago, John Hourican would not have predicted today's events. Back then, RBS was posting its last results before the global banking and markets division was to morph into a markets and international banking-split business under Hourican’s leadership.

15:35: Nielsen says there was no attempt by RBS to monitor potential conflicts of interest between traders and Libor submitters who were “co-located” at the bank between late 2008 and April 2009. He adds that senior managers “felt that it was almost a mathematical impossibility” for traders and Libor submitters sat in close proximity to move the Libor benchmark rate.

15:37: Philips is clearly leading proceedings. He switches tack from Libor itself to culture and leadership, and Cameron faces the tone-from-the-top moment. He says the affair has been “shattering to us”, but says “You cant impose moral standards on people who don’t wish to be moral.”

15:38: Cameron says there was a “trading culture” across the industry as opposed to a culture learned from within a particular institution. He echoes Nielsen’s view that RBS management and risk managers underestimated the potential for the manipulation of Libor: “It just didn’t occur to anyone that this was a rate that could be fiddled.”

15:50: If things could have become more galling for the RBS trio, they just have. It’s been pointed out that the so-called wash trades, part of the wrongdoing at RBS, were first spotted by the Financial Services Authority, not by the bank’s own compliance procedures. So that would be the same FSA of which Parliamentary Commission chairman Andrew Tyrie, a while back in his capacity as chair of the Treasury Committee, once asked if it had been “asleep on the job”. Fallout from the financial crisis means the FSA is set to be disbanded in a month or so, but at least they spotted this one…

15:57: Nielsen says RBS’s executives “focused almost exclusively on the things that broke the bank” after the financial crisis, rather than attempted Libor manipulation. He says that, if the bank had focused more quickly on the “cultural and attitudinal aspects” then it would have been in a “better shape” today. “I wish we’d got to them [Libor manipulators] earlier,” he adds.

16:12: Justin Welby, the Arhcbishop of Canterbury, is in no mood for niceties. He asks Cameron: “How do you test for the moral culture of a trading floor?” Cameron warns that we’re on “very philosophical territory”, but that’s fine with Welby, who says this is what brought down RBS. Cameron says attitudes to risk controls were not a problem, but risk managers in the case of Libor did not recognise it as a risk.

16:23: Thank the world for Mark Garnier. The Tory MP has taken mercy on Hourican, who was stumbling through an answer to no particular question by getting down to specifics again. “When were the RBS execs first aware of the Libor investigation?” Nielsen says it was in 2010 when the bank first received documents from the CFTC. For Cameron it was when he read about it in the newspapers. He, of course, wasn’t with the bank by then.

16:30: Tyrie wraps up the first segment of this afternoon’s session, asking Hourican if he feels he has been “the human shield that has taken the hit”, and how he feels about Hester and Nielsen remaining with the bank after its Libor settlement, Hourican says he must “live by the principles I adopt”. He reiterates his view that the bank would be better off if he left while the others stay.

The Commission will be back in 15 minutes to question Stephen Hester and Sir Philip Hampton.